Tesla Revokes $29 Billion Interim Compensation for CEO Elon Musk After Court Ruling

Tesla has revoked an interim compensation package worth $29 billion that was awarded to its CEO Elon Musk in August 2025. The decision followed a recent Delaware Supreme Court ruling that restored Musk's 2018 compensation award valued at $56 billion.

The company had provided the interim package as a hedge in case the appeal was rejected. In a quarterly filing with the Securities and Exchange Commission on Thursday morning, Tesla confirmed that its board voted to revoke the interim award on April 21, 2026.

The board made this decision without participation from Elon Musk or his brother Kimbal Musk, who is also a director. Tesla stated in the filing that these actions prevent any windfall for Musk if he exercises the 2018 award.

A shareholder challenged it in court, alleging improper negotiation and lack of disclosure to shareholders. A judge ruled in favor of the plaintiff in 2024, striking down the package. Tesla appealed the decision to the state's supreme court. During the appeal, the company conducted a shareholder re-vote on the package and developed the interim award.

Musk indicated he might develop artificial intelligence outside Tesla if the appeal failed.

The board also created a separate compensation package potentially worth up to $1 trillion, tied to operational milestones over 10 years. These include delivering 20 million vehicles, producing a million robots, and deploying one million robotaxis, along with increasing the company's valuation to more than $8 trillion.

The revocation of the interim award has no impact on this larger package. In the filing, Tesla reported unrecognized stock-based compensation expense of $9.97 billion for a probable operational milestone. It also noted expenses between $105.82 billion and $120.37 billion for milestones considered not probable.

board imposed restrictions on Musk's ability to sell shares from the restored 2018 package. These require Musk to remain as CEO or in a product development executive role through at least 2028 for shares to vest. He must also hold the shares for five years after vesting.